Gold Reaches New Peak: Implications for Bitcoin's Future

• Gold price climbs to unprecedented $3,578 in early September, fueled by global instability and recent US trade restrictions.
• Bitcoin tests two-month lows around $107,350, continuing a three-week downtrend from its August peak of $124,474.
• The near-zero correlation between Gold and Bitcoin during this period challenges the "digital gold" narrative but supports their roles as complementary hedges.
• Gate interviews several industry experts to gather insights on Bitcoin and Gold in the current market landscape.

As Gold (XAU/USD) ascended to a new record high of $3,578 in early September, Bitcoin (BTC) faced challenges, revisiting July lows after a three-week decline. This divergence has reignited discussions about the respective roles of Gold and Bitcoin as value stores. The weak correlation between these assets questions the "digital gold" concept but reinforces their potential as complementary hedging tools. To delve deeper into the Gold and Bitcoin dynamic, Gate sought expert opinions from the cryptocurrency sector.

Gold Ascends to $3,578 in Early September

The price of Gold surged, surpassing April's previous record of $3,500 and establishing a new high of $3,578 on Wednesday, following months of steady accumulation. This upward movement in the precious metal's value has been primarily driven by global uncertainty and the implementation of US trade barriers.

Gold's enduring strength has led to a significant shift, with central banks now holding more Gold than US Treasuries in their reserves for the first time since 1996. Furthermore, US public debt has ballooned to $36 trillion – 123% of the Gross Domestic Product (GDP) – and has been expanding at a concerning 7.43% annually since April 2020, according to data from Bitwise Europe and Bloomberg.

A recent Bitwise Research report highlights that fiscal deficits and money supply growth rates have begun to accelerate, particularly following the extensive fiscal and monetary responses necessitated by the 2020 Covid-19 crisis.

Moreover, rising inflation expectations and geopolitical tensions in the wake of the 2022 Russian-Ukrainian conflict have eroded confidence in US Treasuries, resulting in their poorest performance on record, significantly underperforming Gold.

Additionally, Gold's share of Global Reserves has reached levels unseen in approximately 30 years, hitting 21% as of Q1 2025, according to State Street Investment Management. The World Gold Council reports an even higher figure of 26.8% as of Q2 2025. This upward trend underscores Gold's position as a leading alternative to fiat instruments and further solidifies its role as a structural hedge in the global economy.

Bitcoin at a Crossroads

While Gold shines, Bitcoin finds itself at a critical juncture. BTC price revisited its early July lows of $107,350 over the weekend, extending a three-week downtrend from its August 14 all-time high of $124,474. This sell-off in BTC has had widespread implications for the broader cryptocurrency market.

A K33 research report this week notes that the ETH/BTC cross has stabilized at 0.04 for the past ten trading days, with subdued Chicago Mercantile Exchange (CME) enthusiasm indicating a pause in Bitcoin's bullish momentum. Furthermore, BTC's average daily spot trading volume declined to $2.9 billion this week, a 20% decrease compared to the previous week.

"Despite the downward trend, activity has remained consistently high, with less weekly variance since mid-July compared to Q2 – indicating a vibrant spot market amidst BTC's ongoing consolidation in the $110,000 range," notes a K33 analyst.

Examining Gold and Bitcoin Correlation

An analysis of the correlation between Gold and Bitcoin reveals intriguing insights. The K33 analyst explains that the current 30-day correlation between Gold and Bitcoin stands at 0.11, while the 90-day correlation is -0.09. The rolling 365-day correlation between the two assets is 0.026, suggesting that their return profiles are largely independent of each other.

This divergence challenges the "digital gold" narrative, as Bitcoin's price movements appear increasingly detached from Gold's, supporting the argument for holding both assets as complementary hedges in uncertain macroeconomic environments.

Meanwhile, Bitcoin is gaining traction as an alternative store of value, potentially disrupting Gold's technological dominance in the long term. Central banks are officially exploring the diversification of their reserve assets into Bitcoin, and several countries, including the US, are considering establishing Strategic Bitcoin Reserves. In the short to medium term, Gold is likely to maintain its status as the primary safe-haven asset, while Bitcoin's ongoing adoption and evolving nature position it as the closest contender for that status over the long term.

Furthermore, Bitcoin's price is becoming increasingly sensitive to market-based US inflation expectations, accompanied by growing scarcity. Bitcoin's responsiveness to US inflation expectations is intensifying with each additional Halving event.

Consequently, it is not surprising that Bitcoin tends to cycle with the ebbs and flows of global money supply expansion and contraction.

In fact, due to its absolute scarcity and low supply growth relative to fiat currencies, "Bitcoin may be the best barometer for global monetary dilution that we have," according to a Bitwise analyst.

Regarding volatility, a River research chart demonstrates that Bitcoin's volatility has steadily declined over time, now comparable to that of Gold and many stocks. While many still view Bitcoin's volatility as a disqualifying factor and will continue to operate under that past perception for some time, businesses that scale their allocations to match their risk appetite need not be concerned.

Historical Pattern: Gold Leads, Bitcoin Follows

David Foley, Co-Founder and Managing Partner of the Bitcoin Opportunity Fund, observes that Gold often moves first, with Bitcoin later following and eventually outperforming. This pattern was evident in early 2025 when Gold reached a new all-time high in April, while BTC initially lagged, only to mirror the move and achieve fresh highs in Q2.

Expert Insights on Gold and Bitcoin

To gain further perspective, Gate interviewed experts in the cryptocurrency markets. Their responses are presented below:

Billy Luedtk, Founder of Intuition

When asked about the rising popularity of Gold as a safe haven and its influence on Bitcoin's perception and adoption in the current economic climate, Luedtk stated:

"The resurgence of Gold validates a deeply rooted instinct: during uncertain times, people gravitate towards scarce, non-sovereign assets. This trend benefits Bitcoin by reinforcing the narrative that trust in fiat systems is waning. Each time Gold reclaims attention, it reminds the world of the value of 'outside money' - and Bitcoin represents the most modern, liquid, and programmable form of outside money. Gold strengthens the framework; Bitcoin expands it."

Regarding the key factors that could determine whether Bitcoin follows a similar upward trend as Gold during times of global financial uncertainty, Luedtk identified several crucial elements:

"Liquidity and adoption are paramount: the continued deepening of Bitcoin's institutional and retail market depth is crucial. Narrative alignment is also key: the credibility of Bitcoin as 'digital gold' must be maintained, especially during periods of aggressive central bank printing or rising geopolitical tensions. Market infrastructure, including ETFs, custody solutions, derivatives, and regulatory clarity, will play a significant role in facilitating easier allocation. Finally, correlation shifts are important: if Bitcoin demonstrates a lack of correlation with risk assets during times of stress, it will solidify its position alongside Gold."

On the long-term roles of Gold and Bitcoin as stores of value, given their differing characteristics, Luedtk offered this perspective:

"Gold will likely remain the conservative anchor, a physical, millennia-tested hedge that is trusted but static. Bitcoin, in contrast, is dynamic: it inherits scarcity but adds portability, divisibility, programmability, and the ability to integrate into digital economies and AI-driven systems. Over the coming decades, I anticipate Gold maintaining its role for central banks and legacy institutions, while Bitcoin increasingly becomes the 'native collateral' of the digital era, serving as the hedge that powers new financial rails."

Vikrant Sharma, CEO/Founder of Cake Wallet

Sharma shared his views on the long-term roles of Gold and Bitcoin as stores of value:

"In my assessment, Gold is unlikely to compete on the same scale as Bitcoin in the long term. Bitcoin's absolute scarcity of 21 million coins, contrasted with Gold's practically unknown true supply, creates a clear advantage in terms of scarcity. Moreover, Bitcoin mining is permissionless and open to anyone, while gold mining is subject to numerous regulations, permits, and restrictions. Bitcoin can be traded 24/7, transferred globally in minutes, and billions of dollars worth can be memorized through a simple seed phrase. Every gold transaction, on the other hand, requires physical handling, verification, transportation, and substantial fees."

Regarding the rising popularity of Gold as a safe haven and its influence on Bitcoin's perception and adoption, Sharma commented:

"The growing appeal of Gold as a safe haven, in my opinion, is supporting rather than competing with Bitcoin's investment thesis. It validates the central claim that investors require alternatives to fiat money. This paves the way for Bitcoin to be viewed as 'digital gold,' a technological interpretation of the same concept. However, confidence in reported reserves is crucial, and there could be significant discrepancies between reported and actual holdings if a true audit of the world's gold reserves were ever conducted. Given that Bitcoin's supply can be transparently verified on the blockchain at any time, this could dramatically shift the safe haven narrative in favor of the cryptocurrency."

On how broader economic trends might impact the future relationship between Gold and Bitcoin, Sharma offered this perspective:

"Both assets should benefit, but the wild card remains a potential audit of gold reserves. If concerns arise about reported versus actual holdings, it could trigger a crisis of confidence and propel Bitcoin to new heights as the only genuinely verifiable store of value. The entire supply of Bitcoin can be audited in seconds; try auditing gold vaults scattered across the globe. While monetary tightening might exert short-term pressure on Bitcoin more than gold due to its risk asset correlation, long-term quantitative easing would significantly increase that correlation. Furthermore, the rise of AI-driven economies adds an entirely new dimension. As AI agents evolve into economic actors, they will require native digital currency for transactions. These agents will utilize Bitcoin for instantaneous, programmable, and trustless transactions, rather than dealing with physical delivery or gold vaults. Gold simply cannot keep pace with the enormous demand this creates. Short-term movements in gold may indicate Bitcoin's direction, but in the long run, Bitcoin emerges as the clear winner due to its verifiability, absolute scarcity, and native compatibility with digital and AI economies. The question is not whether Bitcoin will surpass gold, but how soon the shift will occur."

Gate Analysts

Gate analysts provided the following insights:

"Gold's record-breaking performance this year, driven by central bank accumulation and increased safe-haven demand, has bolstered the investment case for scarce, non-sovereign assets. This dynamic has indirectly strengthened Bitcoin's institutional narrative, even as near-term capital flows continue to favor Gold's perceived stability. Whether Bitcoin tracks Gold higher during periods of market stress will depend on several factors: the trajectory of the US dollar and real yields, the expansion of new access points such as ETFs and retirement accounts, and the market's ability to absorb liquidity shocks without triggering forced deleveraging."